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2014 (6) TMI 1057 - HC - Income TaxDeduction u/s 80P(2)(a)(i) - Assessee is a Cooperative Society - HELD THAT:- It is not in dispute that the assessee-The Karnataka State Co-Operative Housing Federation Limited is a co-operative society registered under the Act. It is a federal society, the membership of which is open to a co-operative society registered under the Act and not to individuals. However, the proviso makes it clear that if an individual is to be admitted as a member of a Federal Society it could be done as a nominal member. The definition of a Member contained under Section 2(f) includes a nominal and an associated member. In order to attract the benefit of deduction in respect of income of a co-operative society, what is required is that the assessee claiming benefit should be carrying on the business of banking or providing credit facilities to its members. As an individual could be a nominal member both of a federal society and a co-operative society and if a federal society extends credit facilities to such nominal members, the income derived from such business falls within Sub-Section (2)(a)(i) of Section 80P of the Act. Therefore, the assessee would be entitled to the benefit of deduction. Therefore, the finding recorded by the Tribunal that the assessee is entitled to the said benefit is strictly in accordance with law and it cannot be found fault with. In that view of the matter, we do not see any merit in this appeal. Therefore, the substantial question of law is answered in favour of the assessee and against the revenue.
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